Image: portal of the mayor and government of Moscow/Evgeny Samarin
Deputy Director General of the national energy Institute Alexander Frolov explained that as a result of the coronavirus a pandemic in the oil market supply and demand continue to remain unstable, according to news Agency “national news service”.
He noted that the restrictions on movement throughout the world affect the demand for oil. So, as of today, it is clear that assumptions about the growth of demand for oil in 2023 were incorrect.
“the Second issue that must be addressed is the subject of the sentence. We have a conflict, which, in fact, unleashed Saudi Arabia. And the main question that arises in this context: how long Saudi Arabia will continue these strange movements”, – said Frolov.
He did not exclude that in the near future a possible rise in oil prices, since the production of black gold in some countries is costly to companies. In addition, the cost of oil can not long remain at that low level, because in the long term, demand for oil will grow.
“But if the situation develops as expected in the moment: epidemic will take place, demand will recover and return to normal figures, the growth trend, which was observed quite a long time, the cheap hydrocarbons will not be able to provide even the current costs of production in many regions of the world,” – said Frolov.
He added that the low oil price will scare away potential investors, and therefore reduce the supply, which will also provoke a rise in oil prices.
in Addition, Frolov has noticed that the recovery of demand to levels of 100 million barrels a day, coupled with the normalization of relations between the member countries of the OPEC format+ will provide a sharp increase in the cost of black gold.
“[OPEC+ and the U.S.] are the largest in the world at the moment oilth industry and are on the verge of a major crisis in this industry, with the consequent reduction of production and numerous bankruptcies of market participants”, – said Frolov.
Earlier it was reported that the cost of oil of mark Brent fell to levels 21.82 per barrel. And the cost of Russian oil Urals and is decreased to 16.2 per barrel.
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